| This dissertation consists of three essays. The first chapter studies an extension of Spence's job market signaling game which allows a discrepancy in workers' discount factors. When the second dimension of idiosyncrasy is introduced, the single crossing property between high and low productivities can be violated. In general, multiple sequential equilibria exist even after Cho and Kreps' intuitive criterion is used for refinement. We show that Grossman and Perry's perfect sequential equilibrium concept can yield a tighter prediction, and characterize the sequential equilibria that survive this refinement. When discount factors are not too different, the unique outcome selected is still the least costly separating equilibrium for the high productivity types, as in Spence's original model.;The second chapter studies intertemporal decision making with endogenously determined preferences and the consequent self-control issues. We postulate that the history of choices plays a role in shaping an individual's preference, while inconsistent preferences indicate the need for self-control. We examine two types of decision makers: the sophisticated and the naive, who differ in their self-knowledge of the future preference change. The decision outcomes for these two types are characterized and compared. For welfare comparisons, we use the initial preference, and show that under mild conditions a sophisticated person must be better off than a naive person.;The third chapter studies a two-period contract design problem, where agents have endogenously changing preferences about which they are either sophisticated or naive. Optimal contracts under both symmetric and asymmetric information are examined. We compare the case of period-by-period offers as well as a comprehensive two-period offer the principal can commit to. It is shown that when types are known to the principal, committing to a two-period contract offer is superior to spot contracting, and that a two-period contract extracts more surplus from a naive agent than from a sophisticated agent. When the first best cannot be achieved under asymmetric information, we conclude that informational rent, if any, accrues to both types of agents. |
